HK exports up as jobless rate slips

(The Standard, March 18, 2011)

Hong Kong's economy is on a roll, spurred by declining jobless rates and growing exports, but the crisis in Japan could act as a damper and disrupt the strong momentum, and economist warns.

The SAR's jobless rate dropped to 3.6 percent for the three months ending February, as compared to 3.8 percent in the quarter ending January. Beating a forecast of 3.7 percent, the rate was the lowest since the Lehman Brothers' collapse in September 2008.

But BWC Capital chief economist Daniel Chan Po-ming expects the SAR to see more challenges. New graduates will join the labor force in May when the minimum wage comes into force.

And the disaster in Japan may affect Hong Kong. "Since many high-end electronics products come from Japan, this sector will see the most impact," Chan said.

Total employment decreased by around 6,600 to 3.57 million in the three-month period ending February, with the labor force shrinking to 3.7 million.

The underemployment rate declined to 1.7 percent from 1.8 percent.

"In the near term, employers are positive about hiring staff ," said Secretary for Labor and Welfare Matthew Cheung Kin-chung, adding that the government will remain vigilant.

Meanwhile, Hong Kong's export volumes increased 20.7 percent, while imports rose 12.5percent.

Exports to the mainland grew 22.3 percent, followed by a 20.6 percent growth to the United States. Imports from the mainland increased 18 percent. Paul Tang Sai-on, chief economist at Bank of East Asia (0023), added that Hong Kong's re-exports will suffer as many Japanese products go to the mainland through Hong Kong.

Handout heading to bank accounts

(The Standard, March 09, 2011)

People are likely to get the HK$6,000 budget handout put into their bank accounts, sources said.

The Hong Kong Monetary Authority met with local banks over the possibility of handing out the cash through bank accounts and last week asked banks to submit statistics of individual account holders.

An HSBC banker said yesterday that giving out the cash in that way is feasible.

In an abrupt about-turn, Financial Secretary John Tsang Chun-wah last week scrapped the plan to inject HK$6,000 into the MPF accounts of all workers and announced giving the same amount to all adult permanent residents.

He also said a scheme is being planned to encourage citizens not to withdraw the money immediately. One idea is to provide interest incentives to those who do not use the money at once.
Tsang yesterday remained tight- lipped over how the money will be handed out.

Sources have said that the authorities are unwilling to send checks through the post as letters can get lost.

Mark McCombe, chief executive of HSBC in Hong Kong, said using the banking system is one feasible option.

"I think operationally it will not be a problem because Hong Kong already has a very effective payment system and a very effective interbank system," he said.

"People in Hong Kong have bank accounts."

It is understood that more discussions will be held between banks, other stakeholders and the authorities over technical details, including how to cover those who do not have an account.

Another issue is those who have had their account frozen may have to retrieve the money directly from the government.

Those with more than one account reportedly may be able to choose into which one they wish the money to be deposited.

McCombe also said more discussions are needed with the monetary authority and the government for the option to be finalized.

"But it's down to the government and the HKMA to lead the way on this. It's not our initiative. It's an initiative of the government," he said.

Authority officials are expected to meet again with banks in the next few weeks to finalize the details.

中小企信貸保證額增百億

(明報 2011年2月23日) 於2011-12年度的財政預算案中，曾俊華表示，為進一步支持中小企，「中小企業信貸保證計劃」的信貸保證承擔總額由200億增至300億。 曾俊華指出，工業貿易署的「中小企業信貸保證計劃」一直受到業界歡迎。

自2008年11月實施加強措施後，大大增加了中小企在使用信貸保證方面的彈性。截至2011年1月底，工業貿易署已批出超過150億元的信貸保證，涉及貸款約330億元，惠及超過12000家中小企。為顯示政府對中小企的持續支援，他建議將「中小企業信貸保證計劃」的信貸保證承擔總額，由現時的200億元大幅增加至300億元。

Happy Lunar New Year

HK remains freest economy as lead slips

[Hong Kong Standard, Jan 13 2011]

“Hong Kong remains the freest economy in the world for the 17th straight year but Singapore is hot on its heels, the Heritage Foundation said.

The Economic Freedom Index, released yesterday by the conservative think tank and Wall Street Journal ranks 183 countries and places on 10 measures for openness, rule of law and competitiveness.

While Hong Kong's score is unchanged at 89.7 out of 100, Singapore gained 1.1 points on financial freedom.

"There is a possibility Singapore may overtake Hong Kong in the near future as the state has more room for improvement in banking," said Terry Miller, the US foundation's index editor, adding Hong Kong's major drawback is an oversized fiscal surplus.

"There's no reason the government should have a surplus more than the monetary base," said Hugo Restall, editorial page editor for Wall Street Journal Asia. That surplus, he said, should be cut by at least half and the profits tax rate trimmed to 15 percent.

Hong Kong declined in government spending and labor freedom.

The mainland came in as "mostly unfree" at 135 and a score that is lower than averages for the world and Asia.”

With the minimum wage legislation implemented and major revisions of the Company Law under way, our business community is keeping an watchful eye on impact of such to the dynamics of our market.

最低工資議案通過

(蘋果日報2011年1月6日)

爭論多時的最低工資水平正式落實，立法會昨日大比數否決廢除最低工資水平定在時薪 28元的議案，換言之，本港首個最低工資水平將按政府建議訂在時薪 28元， 5月 1日生效。

三項修訂全否決
立法會昨審議最低工資三條附屬法例，部份議員提出動議廢除最低工資時薪 28元議案、將最低工資實施日期由 5月 1日推前至 2月 1日，以及將僱主保存工資紀錄月薪上限由 11,500元提高至 20,000元，三項修訂同樣被否決。

New Banks to join Loan Scheme for Small & Medium Enterprises

[Hong Kong Standard, Jan 3 2011] "Ten banks have signed deals with the Hong Kong Mortgage Corporation to participate in a financing plan for local small- and medium-sized enterprises.

The corporation's SME financing guarantee scheme helps non-listed local companies obtain loans from banks, beginning this month.

The money can be used as general working capital or to acquire assets.

The corporation will guarantee 50 to 70 percent of bank loans for eligible companies - up to HK$12 million for a firm for a maximum of five years.

"Administrative fees will be waived for SMEs that join the scheme before the end of June," said a spokesperson for Bank of East Asia.

"The scheme can provide some buffer to the market, to protect SMEs," said Alex Cheung Kin-sang, DBS (Hong Kong) managing director. A source said SMEs need time to study the details."

For more details about the loan scheme or participating banks, please contact our customer service team at Synergy Business Centre at (852)28041628 or info@synergybc.com.hk .